Roark Capital Makes Offer to Buy Buffalo Wild Wings
14 November 2017 - 10:43AM
Dow Jones News
By Dana Mattioli
Buffalo Wing Wings Inc. has received a takeover bid valued at
more than $2.3 billion from private-equity firm Roark Capital
Group, according to people familiar with the matter.
Roark made an offer of more than $150 a share in recent weeks,
one of the people said. Buffalo Wild Wings shares closed Monday at
$117.25, giving it a market value of $1.84 billion. The stock
jumped 28% to $150 after hours following The Wall Street Journal's
report of the bid.
Investment bankers at Barclays PLC are working with Roark, while
Goldman Sachs Group Inc. is advising Buffalo Wild Wings, the people
said.
Minneapolis-based Buffalo Wild Wings is a purveyor of chicken
wings, beer and other bar snacks at more than 1,200 locations
world-wide. The company was founded in 1982 and went public in
2003.
Buffalo Wild Wings has been hurt by rising chicken prices and
slumping traffic in its restaurants and had been under attack from
Marcato Capital Management LP. The activist investor had pushed the
company to franchise more stores, boost profit margins, increase
sales and replace its chief executive.
In June, Buffalo Wild Wings shareholders voted in Marcato's
founder and two of its nominees to the company's board. Chief
Executive Sally Smith announced she would retire by the end of the
year.
The stock, which had already been under pressure, had fallen
more since then, until Monday's after-hours surge. Even when it had
been above $150 a share, Marcato argued that it was well
undervalued. So it isn't clear how receptive the company would be
to a proposal around that level.
Roark focuses on franchise-based companies and has investments
in Arby's, Carvel, Auntie Anne's Pretzels and Carl's Jr.
There has been a spate of restaurant consolidation in the past
year. In April, European investment fund JAB Holding Co. agreed to
buy Panera Bread for roughly $7 billion. Just last week, JAB agreed
to buy Au Bon Pain.
Roark had been a contender to buy fried-chicken restaurant
Popeyes Louisiana Kitchen Inc. earlier this year, but lost out to
Restaurant Brands International Inc .
--David Benoit contributed to this article.
Write to Dana Mattioli at dana.mattioli@wsj.com
(END) Dow Jones Newswires
November 13, 2017 18:28 ET (23:28 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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